GM Stock Looks Dirt Cheap

The besieged car maker is seeing strong results on the sales floor. With a rock-bottom valuation and 3.3% yield, shares could rise 30%.

General Motors has done a great job selling cars and trucks this year. Its stock, however, is down 8% in 2014, which means it has underperformed the Standard & Poor's 500 index by 15 percentage points and rival Ford's stock by 21 points, not counting dividends.

Why the disconnect? A faulty ignition scandal has marred GM's (ticker: GM) image, costing it two-thirds of last year's profit in recall fees. Yet last month the company sold 1% more vehicles than a year ago. Adjusted for two fewer selling days in June this...